In South Florida, from Palm Beach to Miami Beach, the luxury real estate market is smashing records, thanks to the influx of billionaires and millionaires.
During the third quarter, the average home sale price in Palm Beach skyrocketed past $20 million, making it the most expensive market in the U.S. This is backed by data from Douglas Elliman and Miller Samuel, which also showed that the cost per square foot in Palm Beach reached an astonishing $4,554, more than 2.5 times higher than Manhattan.
What’s driving this mansion boom in South Florida? It’s primarily the ongoing migration of millionaires and billionaires from high-tax states like New York, New Jersey, and California, coupled with Florida’s booming economy. Since these ultra-wealthy buyers usually pay in cash, they aren’t as affected by rising mortgage rates.
But here’s the catch: the limited availability of properties, especially those with waterfront views, has driven up prices substantially. In the third quarter, Palm Beach had just 53 homes for sale, down 61% from pre-pandemic levels. This reduced supply led to a 31% drop in sales over the past year.
However, real estate experts anticipate that this limited supply will keep pushing prices higher, making luxury properties even more exclusive, even for those with multi-million-dollar budgets.
Unbelievable sales aren’t rare here. In July, a waterfront property that was last sold for $7.4 million was snagged for about $50 million. Fashion mogul Tommy Hilfiger sold a Palm Beach mansion for $41.4 million, only six months after he bought it for $36.9 million.
The most expensive Palm Beach home sale on record happened in April when luxury car dealer Michael Cantanucci paid a staggering $170 million for a 1.6-acre oceanfront mansion.
Despite the usual summer slowdown, the South Florida market saw a strong comeback in September, driven by high-net-worth buyers who act fast. Miami Beach has also seen prices spike, especially for luxury real estate.
The rich and famous are pouring into Miami. Tech billionaire Eric Schmidt and his wife have snapped up over half a dozen homes on the Sunset Islands, spending more than $140 million. And hedge-fund billionaire Ken Griffin keeps expanding his footprint on Star Island.
Jeff Bezos, too, has joined the billionaire’s club, spending $150 million on two adjoining properties in Indian Creek Village, giving him 4.6 acres in an exclusive enclave, right next to NFL legend Tom Brady.
As South Florida’s real estate market continues to thrive, it remains an attractive destination for the world’s wealthiest individuals seeking luxury and investment opportunities.